Looking at the Zacks Rank #1 (Strong Buy) list, the three image companies’ stocks are standing after they were able to beat Q2 earnings expectations.
Let’s take a quick look at the highlights and see why now is a good time to invest in these top-rated stocks based on their strong quarterly results.
1. Taiwan Semiconductor TSM
Year-to-date performance: +55%
One of the most searched stocks on Zacks.com is Taiwan Semiconductor, the world’s largest integrated circuit company.
Taiwan Semiconductor said it continues to face price challenges including electricity tariffs but Q2 EPS of $1.48 beat expectations by 8% last Thursday as it grew to around 30. % from comparison quarter.
Investors’ high interest in the company’s increasing profitability is that annual earnings are now expected to rise 23% in fiscal 2024 to $6.37 per share versus EPS of $5.18 last year. Additionally, FY25 EPS estimates call for another 27% growth with Zacks estimates at $8.12 per share.
Image source: Zacks Investment Research
2. GE Aerospace GE
Year-to-date performance: +34%
GE is undoubtedly one of the most popular consumer electronics brands and its growth in aviation to jet engine production prompted the name change from General Electric to GE Aerospace.
In reporting its Q2 results on Tuesday, GE said it has the largest growing commercial fleet in the industry as the supplier of choice for rotorcraft and fighter engines. Led by commercial and defense engineers, aftermarket services now account for 70% of GE’s revenue. In addition, GE’s profit suggests that the industrial products company is headed in the right direction in its transformation efforts in the transportation sector.
To that end, Q2 EPS of $1.20 beat estimates of $0.97 per share by 24% and was up from $0.68 per share in the year-ago quarter. Even more encouraging is that GE raised its EPS and free cash flow guidance for the year. Notably, GE is also expected to post earnings growth in the high double digits in FY24 and FY25.
Image source: Zacks Investment Research
3. Honeywell International RESPECT
Annual: -3%
Based on its YTD performance, Honeywell International stock may be the world leader in various technology solutions and manufacturing products.
Like GE, Honeywell is best known for its consumer appliance products and managed to beat Q2 EPS estimates by 3% yesterday with earnings of $2.49 per share. This was an 11% increase from the comparative quarter. That said, Honeywell’s consistent top-line and core growth should keep long-term investors engaged with HON now trading at a multiple of 19.9X which is less than its ten-year high of 30.5 X and a slight drop to the mid 20.1 X.
Image source: Zacks Investment Research
The stage is below
Based on their strong price data, earnings estimates are now higher for Taiwan Semiconductor, GE Aerospace, and Honeywell International for both FY24 and FY25. This suggests that there should be short-term upside in these top-rated stocks as well as long-term investments like the world’s top performers.
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